Many of us are worried about getting into debt, but with wages not rising quickly but other costs going up it can feel that it will be inevitable that we may need to borrow money so that we can just manage. However, it is well worth trying as much as you can to make sure that you can manage before you resort to borrowing. This is because in this situation, you could find that things get even harder when you have to try to repay the money that you have borrowed and you may end up getting further and further into debt.
Therefore, it is wise to have a think about your current finances and what you can do in order to change your situation. There might be quite a few different things that you can try and so you need to think about a selection of options and give more than one a go to give yourself the best chance of staying out of debt.
- Downsizing – the first thing to consider is whether you can downsize t reduce your general costs. If you can move to a cheaper home, which has lower rent and is smaller so lower council tax and costs less to heat, this could make a significant difference. You may also be able to downsize your vehicle to one that costs less money to insure, tax and drive. Although both of these options are big changes to make, they could make a significant difference to how much money you have to pay for other things.
- Comparing prices and switching – everything that we buy has a price. However, if we buy items form different places, we may find that the prices will be lower. This includes everything from short term credit to coffee. So, think about every single thing that you pay for and whether there are cheaper alternatives that you can consider. You could switch providers for your electricity and broadband, change phone or television contracts, buy second hand clothing rather than new and start shopping at a cheaper supermarket. Obviously, you will need to make sure that you are getting good value for money and that you are happy with what you are buying. Sometimes buying cheap means that you get such poor quality things do not last long or they are just not very nice, but this will not always be the case. Sometimes paying extra for a fashionable brand name, is just not worth it at all.
- Reducing spending on luxuries – it can be wise to cut down on buying items that you do not need. We all buy things that are not necessary such as paying towards hobbies, going out, holidays, extra clothes, gifts for people, alcohol, snacks and things like this. It can feel like if we go without any of these things that we are depriving ourselves of happiness. It is important though to remember that marketing companies are very clever at telling us what to think and that we can be happy without spending too much money. We also may not need to cut down on everything, but just be pickier about what we actually choose to buy. We may find that we will start to find it easy to go without certain things, as we do not really need them that much. It will all depend on how much you buy really.
- Selling things you own – if you want to make a chunk of money to help you manage then selling things that you own and no longer need is a good idea. Although the money is not as good as having an income, as you will not be able to keep making more, it will still be helpful. It is relatively easy to sell things these days, whether you choose to do a car boot sale or table top sale or decide that you would like to sell online. There are many ways to do it and it could mean that you could end up with a nice chunk of money and a tidier home as a result.
- Increasing pay from work – if you already have a job then it could be worth thinking about whether there are any ways that you can make more money from it. It could be that you could try asking for a pay rise. This may not be possible or may not work, so alternatively you could see if there is any extra work you could take on. Another possibility is to see if you can apply for a promotion to get a role that is better paid or move to a different role within the company where you can earn more money. You could also look for a new job in a completely different company if you can find any jobs like this that offer a higher salary.
- Take on extra work – it may be easier to keep your main work situation as it is and take some additional work. This can be tricky, particularly if you already work long hours or have a family life, but there are options that might work. You could consider taking on evening or weekend work, but this might be too much. If so then maybe some freelance work could be better. You may be able to find something online that you can do form home. This would suit someone who is less able to leave the house for work or who is already working full-time and wants to not have to go out to work even more hours. Then are many different online jobs that you can do and some are easier than others. The less skilled work is not paid as much, but it can be fun and still give you some extra income.